Oil prices continued to move firmly lower once again in yesterday’s oil trading session with the WTI futures contract for August closing at $102.29 per barrel, and ending with a wide spread down candle as the commodity lost over a dollar per barrel on the day.
In the past couple of days we have seen extreme and unusual price activity in the December gold futures contract with yesterday’s volume exceeding that of Tuesday’s by some distance, but without the requisite move higher.
With the FOMC meeting now consigned to history, and the currency markets now returning to ‘business as usual’ here is a round up for the Aussie, the British pound, the Canadian dollar and of course the euro
Oil continues to find it hard work, building on the bullish breakout of mid June, having moved into a sustained phase of price congestion over the last few weeks, as it continues to slide lower ahead of today’s oil inventories report.
Like the GBP/USD, the Aussie dollar is another currency pair which is now starting to break out from a recent phase of price congestion, but for the AUD/USD, this period of sideways price action has been in place for considerably longer than Cable, with the pair having been range-bound between 0.9150 to the downside and 0.9370 to the upside for some time.
With fear continuing to drain away from the VIX, it’s complacency that rules at present as the ultimate index of fear and greed continues to push ever lower and on towards the elusive single figures below ten.
As another trading month comes to an end, gold traders will be watching wondering and waiting as the precious metal is once again poised delicately at a tipping point on the daily chart.
In any escalation of political tension oil and gold are the two key commodities to watch. For oil the breakout and surge higher was largely driven by events in Iraq coupled with supply issues at Cushing, both of which combined to help power the WTI crude oil (USO, quote) contract up to the $107 per barrel price point as evidenced by last Thursday’s wide spread up candle.
Whilst the ongoing conflicts in both the Ukraine and Iraq are beginning to impact world markets, yesterday’s price action was less severe than expected. In other words, the price action was more of a pause than a major sell off.
On the daily gold chart we are at an interesting phase of price action. The weakness in the price of gold has been clearly evidenced since mid March, with each rally higher petering out. This was then followed by an extended phase of price congestion which saw the precious metal oscillate between $1315 per ounce to the upside and $1280 to the downside.
